Annual Report 2016
INSPIRED Our purpose at Johnson Outdoors is to continually inspire
Our mission is to make that experience the best it can be.
more people to experience the awe of the great outdoors.
We recognize that “best” is ever-changing…inspiring us to
Insight. Innovation. Experience.
continually evolve, so we can stay on top.
Contents
Company Snapshot … 8
Inspired Insight …10
Inspired Innovation … 18
Inspired Experience … 24
Inspired Strategy … 30
Business Performance … 32
Management Perspective … 34
Letter From the Chairman … 36
Inspired Leadership … 38
Inspired Teamwork … 42
Insight puts us
in the right place,
with the right people
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Innovation
keeps us out in front
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Experience keeps
consumers coming back
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JOUT-NASDAQ
Company Snapshot
~$359 m market cap
AS OF 9/30/16
80 countries
16 product categories
20 facilities worldwide
1,200 employees
Johnson Outdoors is a family of core brands preferred by
consumers for creating the best possible outdoor experience.
Through innovative, top-quality products, we earn industry
awards, customer loyalty, and above all, consumer trust.
FISHING
DIVING
WATERCRAFT RECREATION
CAMPING & HIKING
$274.9 M
FY2016 NET SALES
Fishing motors
Fishfinders
Downriggers
Shallow water anchors
Digital charts & maps
$69.1 M
FY2016 NET SALES
Regulators
Buoyancy
compensators
Dive computers
Masks/fins/snorkels
Divewear
$50.4 M
FY2016 NET SALES
Kayaks & canoes
Fishing craft
Personal flotation
devices
$40.0 M
FY2016 NET SALES
Tents
Sleeping bags & pads
Personal & family
cooking systems
Paddles & accessories
Compasses
Camp furniture &
accessories
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Inspired
INSIGHT
Looking inside
our consumers’
minds and hearts
Consumer insights are the
guideposts to innovation across
our chosen playing field: the ever-
expanding, ever-evolving outdoor
recreation market.
The Johnson Outdoors legacy
of success has been built on our
unmatched knowledge of outdoor
consumers. Now we’re deploying a
fresh array of market research and
analytical tools to ensure we constantly
stay ahead of their changing needs and
expectations.
Our intense focus gives us a
deeper understanding of our target
consumers: Who they are. What
makes them tick. And how to put the
awe in their outdoor experience.
This enhanced understanding is
critical to generating the “aha” insights
that focus us on the biggest, best
opportunities in our highly competitive
market. Nothing is more important.
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AWARD-WINNING
This year’s new Jetboil® Genesis™
dual burner cooking system was
named “gear of the year” by leading
outdoor enthusiast publications like
National Geographic Adventure,
Outside magazine, and Gear Junkie,
to name a few.
Jetboil® Genesis™ fires up camp cookware
The world’s first dual-burner cooking system in an easy-to-carry travel bag affirms that today’s
campers and hikers are eager to enjoy great food in the great outdoors. The Jetboil Genesis
system delivers unmatched simmer control under its non-stick fry pan, while its FluxRing®
technology boils a five-liter pot of water at amazing speeds.
Jetboil’s innovative cooking systems keep Johnson Outdoors at the forefront of a market that
has doubled in size over the past two years. True to its name, the Genesis launches a new
generation of outdoor cooking solutions that make it easy to fuel the most demanding crew on
the most rewarding adventures.
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Riptide® Ulterra™ transforms saltwater fishing
Building on the success of freshwater Ulterra™, Minn Kota® this year introduced Riptide®
Ulterra for saltwater anglers. The corrosion-resistant bow-mount trolling motor lets anglers
push a button to stow, deploy and change the depth of the motor. With the wireless i-Pilot®
remote, anglers can adjust to changing conditions without having to get down from the tower
or move to the bow.
Ulterra and Riptide Ulterra are inspired by the insight that consumers want to spend their time
catching fish instead of wrestling with a trolling motor. These revolutionary motors deliver
unmatched boat control and ease of use—empowering anglers to win on the water, and
Johnson Outdoors to win in the marketplace.
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Online to Outdoors
Creating deeper relationships with
digital transformation
From our websites to ecommerce to
social media, we’re expanding digital
sophistication. We’ll continue to encourage
vibrant communities around our brands, from
Jetboil® “Jetheads” tweeting atop mountains to
SCUBAPRO® users posting to Instagram from
their latest dive. These changes will begin rolling
out in the coming year, enhancing consumers’
experience in the virtual world, and in reality.
Customer-centric insights shape not only our
products but also our advertising, promotions—
and digital presence. When today’s consumers swipe
their tablet or smartphone to start an adventure, Johnson
Outdoors needs to be there as a reliable, inspiring guide,
whether they’re looking for a product or a place to use it.
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Inspired
INNOVATION
Raising the bar to
exceed consumers’
high expectations
Innovation is what consumers demand,
what customers expect and what we
continue to deliver. To stay ahead, we’re
taking the Johnson Outdoors innovation
process to a world-class level. The key is
to involve consumers at every step, from
concept to commercialization to category
leadership.
We emphasize a disciplined, fact-based
approach that homes in on the best ideas
with the greatest potential. And we align
product development with sales and
marketing plans to drive even bigger, more
successful new product launches.
The result: products that are
meaningfully better than what’s out
there—with unique design, function and
quality that improve the outdoor experience.
Products that deliver higher-impact,
longer-lasting results.
At Johnson Outdoors, we know innovation
is a game-changer in every sense of
the word.
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AWARD-WINNING
The Old Town® Predator™ PDL
reeled in the 2016 ICAST award for
Best Boat, following in the footsteps
of the Predator MK in 2015 and the
Predator XL in 2014.
Old Town® continues to lead the revolution
Anglers can fish hands-free all day and enjoy precise boat control with the Old Town Predator
PDL, the market’s most advanced pedal-powered watercraft. Its patent-pending pedal system
moves anglers through the water as quickly and smoothly as Johnson Outdoors is driving this
fast-growing kayak fishing segment.
A specially designed hull perfectly balances forward/reverse maneuverability with stand-up
stability. The removable pedal drive installs in seconds and tips up instantly for shallow water
docking. With all the features we know anglers desire, including tons of storage and easy
customization, the PDL delivers a more intimate experience for reeling that big one in.
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AWARD-WINNING DUO
The revolutionary Minn Kota® UltrexTM
took home the gold with the coveted
Best in Show at the 2016 ICAST,
while the ultra-bright Humminbird®
HelixTM 10" SI snagged its
sixth Best Electronics
award.
“Owning the boat” to give anglers an edge
From bow to stern, Johnson Outdoors marine electronics make fishing enthusiasts’ dreams
as real and exciting as our market leadership.
Thanks to breakthrough innovation, anglers can feast their eyes on the Humminbird®
Helix™ 10 SI fishfinder and its ultra-bright, ultra-clear screen. They’re eager to get their feet
on the Minn Kota® Ultrex™ trolling motor’s foot pedal with first-of-its-kind electric cable
steering. And they bring it all together with the i-Pilot Link, controlling the motor via wireless
remote or Humminbird—making it easier than ever to get their hands on some fish.
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Inspired
EXPERIENCE
Finding the point
of view that brings
everything into focus
Consumers using a Johnson Outdoors
product don’t describe what they do as
“using a trolling motor” or “putting on
a wetsuit” or “traveling with an outdoor
cooking system.” Instead, they view it
through the lens of the total experience:
I explore. I discover. I enjoy.
And the more closely we associate
our brands with each user’s outdoor
experience—before, during and after
use—the more likely we are to create the
connections that drive growth.
“Consumer-centric” is our mandate
and our mantra. We are committed to
shaping every aspect of our business with
the consumer’s point of view, working to
make each outdoor experience the best
it can be.
That drives us to innovate more
powerfully, produce more efficiently,
distribute more effectively. From our
internal processes to our digital presence,
we draw on our own experience to
amplify the consumer’s adventure—and
our success.
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“Aha” moments lead to moments of “Ahhh”
Our camping and paddling brands pursue innovations that lead the next generation back to
nature and point Johnson Outdoors toward the future. Eureka!® tents welcome adventurers
with easy setup and roomy design. The new Camp Comfort™ Sleep System combines
sleeping bags, air pads and tent floors for true no-slip sleep.
Old Town® watercraft serve paddlers on weeks-long expeditions and weekends of family fun.
Our classic Loon™ series, relaunched last year for its 20th anniversary, reinvents recreational
kayaks with updates like workdeck storage and a USB port. With comfort and convenience a
given, consumers are free to enjoy the wonders nature lays before them.
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AWARD-WINNING
SCUBAPRO® never fails to
collect honors at the user-
voted Tauchen awards. In
2016, the Everflex drysuit took
home the “bronze dolphin.”
Quality creates high confidence down deep
SCUBAPRO® is the largest, most respected dive brand in the world, inspiring lifelong loyalty
among diving enthusiasts for our world-class quality and technical expertise.
They search out our innovations in core life-support products, specifically buoyancy
compensators, dive computers and breathing regulators. We round out their experience with
a full range of divewear; masks, fins and snorkels; and a host of accessories.
From casual snorkelers to recreational scuba divers to dedicated tech divers, underwater
adventurers find what they’re looking for with SCUBAPRO.
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Inspired
STRATEGY
Advancing
on our plan
Like the consumers at the heart of our
business, Johnson Outdoors is moving
toward new horizons with clarity and
confidence.
Across our business, we continue to
build the momentum required to drive
sustainable growth and enhance long-
term profitability.
Our strategy takes a long-term
view, ensuring we take all the steps
necessary to turn ideas into adventure.
We’re pleased by our progress and
inspired by our opportunities.
And at every phase of our journey,
our focus is clear: Johnson Outdoors
will deliver the best possible outdoor
experience by being the best at what
we do.
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Winning with
INNOVATION
New products spur momentum
OUTSTANDING BRANDS
Minn Kota® | Motors
Minn Kota® | Shallow Water Anchors
Humminbird® | Fishfinders
Humminbird® | Digital Maps
Eureka!® | Family Tents
Jetboil® | Personal Cooking Systems
Old Town® | Canoes
Ocean Kayak® | Kayaks
Scubapro® | Diving Gear
FISHING
DIVING
CAMPING & HIKING
WATERCRAFT RECREATION
Marine Electronics once again
delivered record sales and profits
in 2016. Our flagship Minn Kota®
and Humminbird® brands exceeded
expectations on every measure.
Diving, our most global business,
continued to deal with weak
Middle East markets and European
currency translation. Our strategy is
to exceed divers’ expectations with
meaningful innovation.
Outdoor Gear again moved forward
as the line of Jetboil® personal cooking
systems drove consumer demand with
the Genesis™ dual-burner system.
• Eureka!® remains a trusted
Watercraft sustained its profitable
growth trajectory, fueled by demand
for the Old Town® Predator™ series,
as we work to maximize long-term
innovation and brand growth.
• New products across key channels
camping outfitter as we reposition
• Strong marketplace momentum
powered 5 percent growth
• SCUBAPRO®, the world’s
• The Minn Kota® Riptide Ulterra™
made waves in saltwater trolling
with power-assist and auto stow-
and-deploy
• The ultra-bright Humminbird®
Helix™ 10 SI earned our sixth
consecutive ICAST “Best of
Electronics” award
best-known, most respected
dive brand, focused on
advancing technology
• We continue to evaluate and
prepare to implement more
effective go-to-market and
distribution models
the brand against emerging
consumer targets and focus
innovation on customization
from Old Town® and Ocean Kayak®
propelled a 3 percent increase in
Watercraft sales
• Growth in Jetboil® cooking systems
did not offset declines in non-core
• Old Town® Predator™ fishing kayaks
captured their third ICAST “Best
military tent sales
Boat” award in four years
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Management
PERSPECTIVE
Well-positioned for accelerated,
sustained, profitable growth
Award-winning innovation drove higher
volume and improved margins in fiscal
2016. Total company sales for the year
offset lower sales in dive equipment and
military tents. Gross margins improved
in every business, combining with higher
We ended the year with the balance
sheet in great shape, maintaining a strong
cash position that gives us the flexibility and
resources to invest strategically in growing
our businesses while continuing to pay
cash dividends to our shareholders. Debt
to total capitalization stood at 3 percent at
year-end, a 25 percent improvement over
year-end 2015. Cash, net of debt, reached
an all-time high of $79.9 million at year-end
increased 1 percent to $433.7 million,
volume to deliver 28 percent growth in
versus $61.7 million in 2015.
and net earnings advanced 27 percent to
operating profit, to $22.9 million. Non-cash
$13.5 million, or $1.34 per diluted share.
goodwill impairment charges of $6.2 million
Heading into fiscal 2017, positive
New products in Minn Kota®, Humminbird®,
Jetboil® and Old Town® brands more than
in the current year were more than offset by
a $9.9 million improvement in legal expense
year over year.
momentum for new products is
building and order positions are steadily
growing. In line with our strategic plan,
Johnson Outdoors is well-positioned for
accelerated, sustained, profitable growth
in the future.
Helen P. Johnson-Leipold
Chairman & Chief Executive Officer
David W. Johnson
Vice President & Chief Financial Officer
FY2016 Financial Highlights
• Record sales for Minn Kota® and Jetboil®
• 2017 new products command top industry awards
• Watercraft sustains profitable growth trajectory
• Net cash at all-time high, debt at record low
• Maintained strong balance sheet and quarterly dividend
Operating Results*
Net sales
Gross profit
Operating profit
Net income
2014
$425,410
168,613
16,691
9,123
Diluted earnings per common share
Diluted average common shares outstanding
$0.90
9,635
Capitalization
Total debt
Shareholders’ equity
Total debt to total capital
* $ Thousands, except per-share amount
2014
$7,791
198,458
4%
2015
$430,489
171,733
17,853
10,616
$1.06
9,727
2015
$7,430
197,968
4%
2016
$433,727
176,462
22,894
13,501
$1.34
9,855
2016
$7,389
207,496
3%
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Letter from the
CHAIRMAN
We are moving forward
with a heightened sense
of urgency to quicken the
pace of change in areas of
strategic priority.
Building on a solid foundation, we are taking
investments will continue, with the long-
new product development to the next level.
term goal of delivering sustained, profitable
It’s essential that we involve consumers
growth.
at every step in a disciplined, iterative
feedback loop, and focus resources on
Johnson Outdoors is committed to focusing
ideas with the potential for bigger, better
our enterprise on consumer needs and
marketplace success.
3. Enhance digital sophistication.
Most consumers begin their purchase
helping them enjoy the best outdoor
experience at every step—from planning
their adventure, to shopping and buying
equipment, to having fun fishing, camping,
journey online. We are working to build
diving and recreating on the water, to
Johnson Outdoors continues to make
consumer and market research and data
better connections along that journey,
sharing the memories and awe inspired by
progress on our long-term strategy, focused
analytics empower us to consistently
strengthening relationships with our
the great outdoors.
on raising the bar across our organization
uncover “aha” insights that inspire
consumers. Over the next 18 months, we
to ensure our brands are strong, our
continuous innovation.
businesses are healthy and our company
thrives. Our strategic priorities are clear:
1. Advance market research
capabilities for a deeper, richer
understanding of our consumers.
Outdoor recreation markets change
2. Institute a world-class innovation
process. Our performance this year
demonstrates just how crucial sustained
innovation is to delivering long-term,
profitable growth. Products that are
will be rolling out changes from websites to
We are excited by the future we see for
social media to ecommerce, transforming
Johnson Outdoors and confident in our
the consumer experience with our brands
plans and ability to make it happen.
and our company.
With planning and preliminary execution
phases under our belt, we are now moving
meaningfully and measurably better than
forward with a heightened sense of
constantly, and so do the needs and
what’s out there helped drive record sales
urgency to quicken the pace of change in
Helen P. Johnson-Leipold
expectations of consumers. We must stay
in our fishing business this year. Innovation
all three priority areas. Targeted, strategic
Chairman & Chief Executive Officer
on top of this rapid, ongoing evolution.
has also been central to the turnaround in
And staying on top requires an increasingly
our watercraft recreation business, which
better, more intimate knowledge of our
is now on a positive, profitable growth
target outdoor consumers. In-depth
trajectory.
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Board of Directors
Inspired
LEADERSHIP
Our board of directors offers vital
business acumen and experience.
Terry E. London
Director since 1999
John M. Fahey, Jr.
Director since 2001
Kathy Button Bell
Director since 2014
Thomas F. Pyle, Jr.
Vice Chairman of the Board
Director since 1997
Richard “Casey” Sheahan
Director since 2014
Helen P. Johnson-Leipold
Chairman of the Board
Director since 1999
Photo by John Sibilski Photography
Edward Stevens
Director since 2016
Edward F. Lang
Director since 2006
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Helen P. Johnson-Leipold, Johnson Outdoors chairman and CEO,
leads with skills in strategic planning, global operations, strategic marketing
and branding, drawing on deep knowledge of the company and its industry.
She served as a marketing executive with SC Johnson and Foote, Cone &
Belding. Ms. Johnson-Leipold is chairman and director of Johnson Bank
and Financial Services.; director of SC Johnson; and chairman, The Johnson
Foundation at Wingspread.
Thomas F. Pyle, Jr., Johnson Outdoors vice chairman, brings extensive
managerial, transactional, operational and financial expertise to the role.
Currently chairman, The Pyle Group, and non-executive chairman of Uniek,
Inc., Mr. Pyle is former owner, chairman and CEO of Rayovac Corporation.
He serves as director of Sub-Zero Wolf, Inc.; advisor to the University
of Wisconsin Chancellor; and trustee of Wisconsin Alumni Research
Foundation and other leading research institutions.
Kathy Button Bell is vice president and chief marketing officer of Emerson
Electric Co., a $25 billion manufacturing conglomerate. In 2016, she was
appointed to Emerson’s Office of the Chief Executive. A renowned branding
strategist with expertise in global marketing, digital strategy and market
research, she has served in lead marketing roles with recreational giants
Converse, Inc. and Wilson Sporting Goods. Ms. Button Bell is a director of
Sally Beauty Holdings and the American Marketing Association, and past
chairwoman, Business Marketing Association.
John M. Fahey, Jr., former chairman and CEO of the National
Geographic Society, is knowledgeable in key Johnson Outdoors markets
and outdoor leisure, travel and recreational industries. He brings skills in
leadership, strategic planning, international business and enterprise risk
management. Mr. Fahey is also lead director of Time Inc., a director of
Lindblad Expeditions Holdings and a regent of the Smithsonian Institution.
Edward F. Lang, senior vice president and CFO of the NFL’s New
Orleans Saints and the NBA’s New Orleans Pelicans, provides insight in
leisure industries and consumer products as well as broad experience
in corporate finance, operations and enterprise risk management. He
previously served with the NHL’s Nashville Predators for 13 years, most
recently as president of business operations and alternate governor.
Terry E. London, CEO and interim president of Pier 1 Imports, chairman
of the Pier 1 Imports, Inc. board of directors, and former chairman of
London Broadcasting Company LP and LBK Entertainment Holdings,
provides insight on a broad range of corporate management and financial
matters. Mr. London has been involved with the outdoor industry for more
than 20 years.
Richard “Casey” Sheahan, president of Keen Footwear, brings proven
knowledge, expertise and leadership in management, marketing and
sustainable business practices in the outdoors industry. Former president
and CEO of Patagonia, Inc. and Lost Arrow Corporation, Mr. Sheahan
previously held key executive positions at Kelty, Inc., Wolverine Worldwide,
Inc., Merrell Outdoor Division and Nike, Inc. A lifelong outdoor enthusiast,
Mr. Sheahan serves on the board of the Outdoor Industry Association and
as senior advisor to Backbone Media.
Edward Stevens, Strategic Board Advisor and previous CEO for KIBO
Software, Inc., a unified commerce solutions company, brings extensive
experience in digital strategy, ecommerce, and omni-channel distribution,
along with his international business strategy skills. Prior to his role at KIBO
Software, Inc., he was founder and CEO of Shopatron. Mr. Stevens joined the
Johnson Outdoors Board in 2016.
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Executive Team
Inspired
TEAMWORK
Our executive team gives us an edge
with their experience and capabilities.
Photo by John Sibilski Photography
Karen James
Vice President, Global
Operations
Khalaf M. Khalaf
Managing Director, Legal Affairs
and Corporate Secretary
John Moon
Vice President and Chief
Information Officer
David W. Johnson
Vice President and CFO
Helen P. Johnson-Leipold
Chairman and CEO
Patricia Penman
Vice President, Marketing
Services and Global
Communication
Sara Vidian
Vice President, Human Resources
Bill Kelly
Group Vice President, Outdoor
Gear and Watercraft
Judy Douglas
Group Vice President, Marine
Electronics
Joe Stella
Group Vice President, Global Diving
JOUT-NASDAQ | 42-43
Certain matters discussed in this report are “forward-looking statements” intended to be covered by the safe harbor provisions
for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Please see “Forward-Looking
Statements” in the 2016 Form 10-K for a discussion of uncertainties and risks associated with these statements.
www.JohnsonOutdoors.com
© 2016 Johnson Outdoors Inc.
Publisher: Patricia Penman
Vice President, Marketing Services and
Global Communication
Johnson Outdoors Inc.
Design: Lynne and Gil Leigh, Modern Media
www.modernmediausa.com
Editor: Mary Jo Thome
Production Coordinator: Amy Helvick
Corporate Secretary
Johnson Outdoors Inc. • 555 Main Street
Racine, WI USA • 53403-1015
For more information, contact:
Johnson Outdoors Inc.
Patricia Penman
Vice President, Marketing Services & Global Communication
262-631-6600 • patricia.penman@johnsonoutdoors.com
To contact the Board of Directors directly, visit:
http://investor.johnsonoutdoors.com/contactBoard.cfm
JohnsonOutdoors.com